Tastes Great… Less Filling! The Battle of Two Slotting Strategies

There are two basic strategies for assigning items to bin locations in a warehouse. In a fixed slotting system, every SKU has a set location and new replenishments of that item go to the same bin. In a random slotting system, items are placed in any open bin into which they fit, a decision made on the fly by a system or a warehouse worker. In either case, the replenishment is recorded so that the inventory system knows the quantity in stock in every location. Which approach is better? Partisans on both sides are equally convinced of the merits of their strategy.

Fixed Slotting System

Those on the “fixed” side of the debate argue that they have the better approach for picking. By optimizing the slotting of a pick line, an operation can increase picking productivity and ensure a particular sequence, e.g., one that avoids crushing in a case-to-pallet environment. They would also argue that pickers work faster after learning products’ set locations.

Random Slotting System

Over on the “random” side, supporters would argue that their approach optimizes put away. Storing items is faster because products are assigned to whichever location is most efficient at that particular moment. Furthermore, this strategy avoids the overhead of maintaining an optimally assigned pick line, thereby saving the time of both analysts and line workers who would have to re-bin products periodically. Finally, they would say that there is not much penalty on picking efficiency, particularly if most SKUs tend to move at the same speed.

The Right System for the Right Situation

I think people are partial to whichever slotting system they grew up with or have become used to. It’s hard to imagine the other system working well if you haven’t experienced it. But slotting strategy isn’t just a matter of comfort or opinion. Neither system is inherently better; they just fit different situations depending on the dynamics of an operation. Here are some scenarios to illustrate both sides:

“Fast fashion” or flash sales where you have thousands of SKUs, get new ones constantly, and each only lasts for a short period. It doesn’t make sense to establish fixed bin locations with such high SKU turnover. Random slotting makes more sense in this situation.

Fast movers section of a grocery distribution center, where you pick SKUs constantly in high volumes. Here, a well designed pick face with fixed bins can give you maximum picking efficiency and ensure sequencing from heavy to light.

Slow movers section of a grocery DC, where you have a long tail of slow movers, each with only a few units on hand. It’s not worth the overhead of maintaining set locations, as it won’t make your picking that much more efficient.

Final Thoughts

In the end, the right choice depends on the nature of your product, how many SKUs you hold, how much inventory you have on hand, how fast items move, how quickly you change items, and into what container you’re picking (pallets, boxes, etc…).

But remember, regardless of which binning strategy you pick, you’ll need a well-maintained WMS to ensure your warehouse is managed efficiently.